We all know that Elon Musk’s takeover of Twitter has been anything but smooth — unless you’re a fan of the dramatic rise in hate speech on the app. One of the quickest changes Musk implemented was massive layoffs — 50 percent of the workers were let go — and that’s the origin story of this latest issue.
Attorney Akiva Cohen, partner at Kamerman, Uncyk, Soniker & Klein, sent a demand letter to “Chief Twit” Musk and Acting General Counsel Alex Spiro. And wooboy, is it a doozy. Cohen is acting on behalf of fired Twitter employees who he alleges are not being paid the full severance promised. As Cohen writes, “you’ve been attempting to tap-dance your way out of Twitter’s binding obligations to its employees.”
Cohen requests confirmation Twitter will fulfill its obligations to its employees by December 7th, and if not, a cavalcade of arbitrations across the country will commence. And the cost of those actions will be on Twitter. “Not only will you lose on the merits, but even if you somehow won the victory would be pyrrhic: Twitter will pay far more in attorneys’ fees and arbitration costs than it could possibly ‘save’ in severance due our clients.”
And then he rubs it in, “And to be clear Elon, you will lose, and you know it.” He noted that the severance detailed in the merger agreement under which Musk took over the company is far less than what had been offered since the actual layoffs took place.
Cohen further points to Musk’s likely argument that the severance detailed in the merger agreement is unenforceable since the merger agreement has a clause — 6.9(e) — that there are no third-party beneficiaries to the agreement. But Cohen is ready for that one:
But even were that somehow a viable strategy, you’d still lose. The doctrine of promissory estoppel means that Twitter can’t promise its employees a severance package to get then to stay at the company through the merger, and then renege on that promise once they do. Your insistence on including “no third party beneficiaries: clause in Section 6.9(e) suggests that you were always planning on playing this game, so we’ll be including a cause of action for fraud in our arbitration demands — and seeking punitive damages on top of pre- and post-judgment interest. Worse, we’ve received anecdotal information from our clients and others that indicates the layoff was conducted in violation of FEHA and other anti-discrimination laws. Please provide us by Wednesday the 7th with a demographic breakdown of the individuals Twitter laid off.
This is what we call coming out swinging. Adding causes of action to an employment dispute is playing hard ball. Speaking of….
Or you can double own on breaking your word and screwing over your employees as they head into the holidays. If so, deposing you will be a joy, and you should be aware that Washington law, among others that will apply, will allow us to obtain an award against you, personally, and not just Twitter the company.
Hitting Musk in his own wallet, not just Twitter’s? That’s sure to get his attention.
You can read the full letter — and it is absolutely worth your time — below. (Yes, via Twitter, because irony is dead.)
Kathryn Rubino is a Senior Editor at Above the Law, host of The Jabot podcast, and co-host of Thinking Like A Lawyer. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).